Can I Report My Employer for Paying Me Under the Table?
Employees may want to be paid under the table because they don’t have to pay taxes on the money they earn. Likewise, employers pay workers under the table to:
- Avoid paying payroll taxes
- Save money by not providing employee benefits
- Forego insurance liabilities
- Save time not having to file the relevant tax paperwork
- Hire undocumented workers
Regardless of the reasons, paying under the table is illegal.
If you want to report your employer for paying you under the table, DoNotPay’s HR complaint tool can help. The tool provides templates for a variety of workplace complaints, including harassment and discrimination. The process is quick, anonymous, and effective.
Consequences of Paying/Being Paid Under the Table
For employers and employees alike, an under the table arrangement may seem like a win-win. But no matter how workers are paid—with cash, check, direct deposit—employers are required to report wage earnings. If caught by the Internal Revenue Service (IRS), there are serious drawbacks for everyone involved:
|No security. If you lose your job, you can’t claim unemployment benefits. Also, you can’t receive worker’s compensation payments and treatments.||Steep penalties. Willfully withholding employment taxes is fraud, punishable by interest and fines on top of the back taxes.|
|No proof of income. Proof of income are documents—typically pay stubs or tax documents—that verify your income or employment. Proof of income is required for securing loans, rental and lease agreements, and mortgage applications. Without it, lenders are less likely to lend to you because you can’t prove you have the financial means to pay the rent/loan/mortgage, etc.||Criminal Charges. The average prison sentence for employment tax evasion spans 14 months to two years long.|
|Tax problems. If you make over $600 in a year as an independent contractor, you have to file taxes with a 1099-NEC, even if you’re paid in cash. Failure to do so could lead to fines and possible criminal charges.||Business shut down. There are cases in which the high costs of restitution force businesses to close down.|
What Are Your Rights as an Employee?
If you get paid under the table, you may be losing out on your rights protected by the Fair Labor Standards Act (FLSA). Those protections cover:
- Minimum wage
- Overtime pay
- Child labor laws
Depending on your state, you may also be entitled to:
- Vacation, holiday, and sick leave
- Mandated meal and rest breaks
- Worker’s compensation in the event of an injury
- Unemployment help if you lose your job through no fault of your own
How to Report an Employer for Paying Under the Table?
It is illegal to willfully withhold taxes from the IRS. If you are being paid under the table, consider filing a complaint so that you can’t be accused of willfully withholding taxes.
- Personal details — your name, address, telephone number
- Employer information — company’s name, address, telephone number, and business type
- Job description — job title and detailed explanation of your duties
- Payment system — amount and how often you get paid, method of payment
- Description of violation — describe how your employer has paid you under the table. Include dates of unreported payments.
Send an Anonymous Complaint to an Employer
Reporting an employer for paying employees under the table doesn’t have to be a hassle. Use DoNotPay’s Anonymous HR Complaint product to file a report in minutes. All you have to do is:
1. Log on to DoNotPay and open the Anonymous HR Complaint product.
2. Enter the employer’s name and the HR department’s mailing address
3. Describe the problems you’re experiencing at work and how you would like them to be addressed.
DoNotPay will compile the information, draft a complaint, and send it anonymously!
Simple, right? With these four small steps, you’ll be one giant leap closer to solving your workplace grievances.
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